How to Play Uncertainties in Q2 With ETFs?

The global market is at a critical juncture right now. The pandemic-driven supply-chain woes and the resultant red-hot inflation, the Russia-Ukraine war that has led to the Western sanctions and the resultant hit to the commodity market, and the central banks’ policy tightening in the developed world to fight inflation may push the global economy into recession over the medium term, if we go by some analysts.

China went back to lockdown mode due to a spike in COVID-19 cases. The United States stopped Russian bond payments, raising risk of default. The Fed’s fight against inflation will trigger a recession in the United States that begins late next year, Deutsche Bank warned on Apr 5.

The probability of a U.S. recession next year may be as high as 35%, according to economists at Goldman Sachs Group Inc. per a Bloomberg article, quoted on a Yahoo Finance article in mid-March. There’s a 35% chance that the S&P 500 could fall into a bear market, per Bank of America, as quoted on CNBC.

The broader market has become extremely volatile and news-driven. Bond Yields are going up and down every day. Accordingly, value and growth investing are flexing muscles alternatively. So, with a number of deterrents doing the rounds in the market, it is wise to look for quality while picking stocks. Market watchers and participants are thus trying out different investing techniques to land upon trustworthy stocks. In this regard, below we highlight a few interesting strategies.

Quality ETFs

No wonder, such a volatile environment calls for quality investments.SPDR MSCI USA StrategicFactors ETF (QUS) measures the equity market performance of large and mid-cap companies across the U.S. equity market. It aims to represent the performance of a combination of three factors: value, quality, and low volatility.

There is VanEck Vectors Morningstar Wide Moat ETF MOAT. The fund follows an index which tracks the overall performance of the “attractively priced companies with sustainable competitive advantages.” As a result, this fund calls for…

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